China's February Caixin manufacturing PMI came in at 49.9 vs. 48.5 expected and 48.3 last, as production expanded slightly in February.
On Thursday, the purchasing managers' index (PMI) for China's manufacturing sector arrived at 49.2 in February, down from 49.5 in January, the National Bureau of Statistics (NBS) reported.
Summary
“Operating conditions faced by Chinese manufacturers were broadly stable in February. Encouragingly, both output and total new orders expanded slightly, despite export sales slipping back into contraction. At the same time, capacity pressures continued to build, with backlogs of work rising further. However, efforts to contain costs contributed to a further decline in employment and inventories. At the same time, a relatively subdued demand outlook weighed on purchasing activity, while confidence towards the year-ahead edged down slightly. Prices data meanwhile showed that average input costs fell for the third month in a row, but prices charged rose slightly.
February survey data signalled a renewed increase in Chinese manufacturing production. Though marginal, the expansion contrasted with a modest reduction at the start of the year. A number of panellists raised output due to firmer client demand, as total new orders also rose slightly during February. Data indicated that the upturn was predominantly driven by greater domestic demand, as new export orders fell marginally.”
Commenting on the China General Manufacturing PMI™ data, Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group said:
“The Caixin China General Manufacturing PMI picked up to 49.9 in February from a recent low of 48.3 in the previous month, pointing to an easing of the economic downturn.”
“The subindex for new orders returned to expansionary territory in February after staying in contraction for two months. Despite slipping back into contractionary territory following a rise the month before, the gauge for new export orders hit its second highest level since March 2018. Domestic manufacturing demand improved significantly, and foreign demand was not deteriorating as quickly as last year.”
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